Long-term investment opportunities in China

China’s economy has developed as its industrial revolution and internet revolution occurred at the same time. This leads us to believe that there are three structural trends which will drive long-term investment opportunities in China: technological innovation, consumption upgrading and industry consolidation.

China is to become a global innovation powerhouse thanks to improved education quality, input in research and development, and policy support for innovation. The internet sector capitalises upon infrastructure, user bases, a unified language and talent. Artificial intelligence (AI) research in China is also progressing rapidly.

If you are looking for evidence that Chinese consumers are confident, look no further than the one-day online sales phenomenon known as Singles Day, initiated by China’s largest e-commerce company, which falls every year on 11 November. Chinese consumers are transitioning from “having” to “having more” and “having better”. As a result, services that improve the quality of life and high-end goods that provide real consumer differentiation are seeing increasing demand.

In the last few years, we have seen a transition in which many companies have reinforced their market positions in China. Consolidation has occurred in sectors such as mining and materials, where there was persistent overcapacity, slowing investment demand and environmental challenges. Industry consolidation has also been observed in internet-related sectors, consumer goods and services sectors and in insurance. This trend is strengthening as the country’s structural economic rebalancing continues.”

This video is issued and has been prepared by a representative of BNP PARIBAS ASSET MANAGEMENT Australia Limited ABN 78 008 576 449, AFSL 223418 (“BNPP AMAU”). This video is distributed in Australia by BNPP AMAU.

This video is produced for general information for wholesale investors only and does not constitute:

an offer to buy nor a solicitation to sell, nor shall it form the basis of or be relied upon in connection with any contract or commitment whatsoever or

investment advice.

BNPP AMAU and the author have not considered the financial objectives, situation or needs of any person in preparing this document. Opinions included in this video constitute the judgment of the author at the time specified and may be subject to change without notice. The author is not obliged to update or alter the information or opinions contained within this video. Investors should consult their own legal and tax advisors in respect of legal, accounting, domicile and tax advice prior to investing in the financial instrument(s) in order to make an independent determination of the suitability and consequences of an investment therein, if permitted. Please note that different types of investments, if contained within this video, involve varying degrees of risk and there can be no assurance that any specific investment may either be suitable, appropriate or profitable for an investor’s investment portfolio.

Given the economic and market risks, there can be no assurance that the financial instrument(s) will achieve its/their investment objectives. Returns may be affected by, amongst other things, investment strategies or objectives of the financial instrument(s) and material market and economic conditions, including interest rates, market terms and general market conditions. The different strategies applied to financial instruments may have a significant effect on the results presented in this video. Past performance is not a guide to future performance and the value of the investments in financial instrument(s) may go down as well as up. Investors may not get back the amount they originally invested.

The performance date, as applicable, reflected in this video, do not take into account the commissions, costs incurred on the issue and redemption and taxes.